Shanghai New Vision Microelectronics (SH:688593) Shanghai Securities·2024-04-09 16:00Investment Rating - The report initiates coverage with a "Buy" rating for the company [6]. Core Views - The company is one of the few in mainland China capable of providing both integrated and separated display driver solutions, with a strong technical foundation and over a decade of collaboration with major clients like BOE [6][12]. - The domestic panel industry is entering a deep phase of localization, with a significant demand for domestic substitutes in the display driver chip market, which is currently dominated by foreign players [6][51]. - The company is positioned as a leader in integrated display chips for wearable devices, with plans to leverage its proprietary technology to reduce costs and penetrate high-end markets [6][30]. Summary by Sections Company Overview - The company specializes in display driver chips, with a comprehensive product range and strong R&D capabilities, serving major brands like HP and Dell [12][29]. - The product lines include integrated display chips, separated display driver chips, and display power management chips, covering various terminal applications [12][29]. Market Potential - The global display driver chip market is valued at approximately $14.2 billion, with the domestic market around $6.5 billion, indicating substantial growth potential [6][66]. - The localization of the supply chain is expected to accelerate, driven by the increasing domestic production of display panels [6][67]. Financial Projections - The company is projected to achieve revenues of 4.80 billion yuan in 2023, with a year-on-year growth of 13%, and is expected to reach 10.44 billion yuan by 2025 [30][84]. - The gross margin is anticipated to improve gradually, reaching 28% by 2025 [30][84]. Competitive Landscape - The company ranks third globally in the LCD smart wearable market with a market share of 24.8% [6][74]. - The domestic market for display driver chips is characterized by low penetration of local manufacturers, with significant room for growth as the industry shifts towards localization [6][51].